Saipem getting work in Novatek's Arctic LNG 2 project

According to the latest Reuters report, Italy's Saipem is likely to get a sub-contractor role in a new project to produce LNG in the Arctic by Russia's Novatek.

Novatek is aiming to produce as much LNG as the world's biggest exporter Qatar and is drawing up plans to build a second plant, known as Arctic LNG 2, on the Gydan Peninsula that juts into the Kara Sea.

Production is due to start in 2022 – 2023.

Saipem was expected to be chosen to build offshore platforms for the facility.

The gravity-based units will sit on the seabed some 40 km from the onshore gas deposit and will produce and ship LNG.

Novatek was also in talks with Saipem to possibly give the Italian company a partner role in managing the company that will oversee the shipyard which is to be built on the Kola Peninsula in north-west Russia.

Novatek started building the wharf – expected to cost US$1.3 – 1.5 billion – last month. The first dock is expected to be ready in 2019.

Arctic LNG 2 will have three lines with a capacity of around 6 million tpy each.

The Utrenneye gas field will be the resource base for Arctic LNG 2.

Novatek is due to start producing LNG at its Yamal LNG project in the fourth quarter. That project will eventually produce around 16.5 million tpy of LNG.

Mikhelson said Novatek was in talks with a number of companies to join Arctic LNG 2, including his current partners in Yamal LNG which is co-owned by France's Total, and China's CNPC and the Silk Road Fund.